Anyone Ever Open A Restaurant?

[cchen]

If you're so sure that you won't fail, please present us a business plan for your proposed restaurant.

 

[earthdragon]

Originally Posted by upstarter

So I've heard everything negative about opening your own restaurant (have several friend's whose families own restaurants) and was wondering if anyone on the forum would like to chip in their 2 cents.

I'd like to open it in 2-3 years, after things (hopefully) get better economically. For a frame of reference, I'd open it somewhere in LA and it's more of a hole in the wall type place rather than high dining.

Any advice, anecodotes, or anything else is welcome!

Upstarter
Do your homework and prepare a solid (conservative business model).
Failure rate in the LA market is very high (even for experienced operators) - with many operators currently showing double digit decline (year on year). Clearly it's not rocket science and a sign of the climate.
Location, location, location is the key = high rents.
California labor laws, also place the operator on the back foot.
Liquor licensing, construction permitting/approvals, health department sign off etc, can also prove to be both time consuming and costly (depending under which jurisdiction you may fall).
What does 'hole in the wall' mean, average guest check $, hours of operation, do you require parking etc?
Having said this, get it right and you can make a decent ROI.

 

[upstarter]

Originally Posted by earthdragon

What does 'hole in the wall' mean

"Hole in the wall" means you offer a product that people get at your counter and sit themselves. No waiters or for that matter plates. think Original Tommy's or Pink's, but different food. Under a 1000sq ft.

I am very with you on a conservative model, no matter how great your product is/every other star aligns. The only thing useful i got out of my college education was econometrics training (aka statistics) and "economic forecasting." You quickly realize that "forecasting" is total bullshit and that you should allow for much greater losses b/c it is impossible to calculate risk. Nasism Taleb harps about this a lot.

Thanks for all the info everyone!